Allbirds shares skyrocket over 600% as flailing shoe company pivots to AI | Latest Tech News
Shares of Allbirds surged practically six-fold on Wednesday after the footwear maker said it was raising capital and pivoting in the direction of AI computing infrastructure.
The San Francisco-based company said that it would execute a $50 million convertible financing settlement with an institutional investor and plans to use the proceeds to purchase graphics processing models (GPUs).
Allbirds also plans to rebrand itself as “NewBird AI” and, over time, shift focus to offering cloud computing capability and AI companies, though it didn’t present extra particulars on its new strategy.
An Allbirds store in the SoHo neighborhood of New York, US, on Wednesday, May 4, 2023. Allbirds Inc. is scheduled to release earnings figures on May 9. Photographer: Victor J…. Bloomberg via Getty Images
The overhaul comes amid strong investor enthusiasm for AI-related shares and the data-center infrastructure that helps it, hoping to benefit from the a whole bunch of billions of company investment pouring into the technology.
“It looks like an attempt to capitalize on the AI movement. I don’t see how Allbirds brings anything to the table beyond name recognition,” said Bruce Winder, an impartial retail advisor.
Allbirds has been shutting most of its brick-and-mortar shops over the last few months owing to muted demand and swap to online partnerships.
Last month, Allbirds said it had offered its model and footwear property to American Exchange Group for $39 million.
The stock closed up 582% at $16.99, valuing the company at practically $148 million.
Allbirds was also among the most lively orders on Fidelity’s trading platform on Wednesday, signaling curiosity from retail merchants.
Allbirds has been shutting most of its brick-and-mortar shops over the last few months owing to muted demand and swap to online partnerships. Getty Images
The transfer echoes past efforts by small US companies that reshaped their business fashions to faucet investor enthusiasm.
In 2017, beverage maker Long Island Iced Tea pivoted to blockchain technology under the identify Long Blockchain
Allbirds made its Nasdaq debut in 2021 at a valuation of $3 billion, but shed about 99% of its market worth as of its last closing price.
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